11:14     CS CONSERVAT P<00351> - Announcement (2)                            

    The gross and net proceeds from the Placing and Subscription are          
    estimated to be approximately HK$93.6 million and HK$91.3 million         
    respectively. It is the current intention of the Directors to use the     
    net proceeds in the following manner: (i) approximately HK$65.0 million   
    will be used for the proposed establishment of a new legal entity to      
    carry out waste incineration and processing business in the PRC; and      
    (ii) the balance of approximately HK$26.3 million will be used as         
    general working capital for the Group.                                    
                                                                              
    EGM                                                                       
                                                                              
    The Board was granted the General Mandate at the extraordinary general    
    meeting of the Company held on 14 January 2005 (the "January EGM") to     
    allot, issue and otherwise deal in up to 162,579,420 Shares,              
    representing 20% of the share capital of the Company in issue on the      
    date of the January EGM. The Placing Shares will be issued under the      
    General Mandate.                                                          
                                                                              
    The EGM will be convened to approve the allotment and issue of the        
    Subscription Shares pursuant to the Subscription Letter. A circular       
    containing, among other things, further information on the Subscription   
    Letter, the recommendation of the Independent Board Committee, the        
    advice of the independent financial adviser on the fairness and           
    reasonableness of the terms and conditions of the Subscription and the    
    notice of the EGM will be despatched to the Shareholders as soon as       
    practicable.                                                              
                                                                              
    Completion                                                                
                                                                              
    Completion of the Placing is conditional upon the Listing Committee of    
    the Stock Exchange granting the listing and permission to deal in all of  
     the Placing Shares to be issued under the Placing.                       
                                                                              
    Completion of the Subscription is conditional upon (i) the Listing        
    Committee of the Stock Exchange granting the listing and permission to    
    deal in all of the Subscription Shares to be issued under the             
    Subscription; and (ii) the approval of the Subscription by the            
    Independent Shareholders by way of poll at the EGM.                       
                                                                              
    An application will be made to the Listing Committee of the Stock         
    Exchange for the listing of, and permission to deal in, the Placing       
    Shares and the Subscription Shares to be issued pursuant to the Placing   
    and Subscription respectively.                                            
                                                                              
    CONTINUED SUSPENSION OF TRADING IN THE SHARES                             
                                                                              
    At the request of the Company, trading in the Shares has been suspended   
    with effect from 9:48 a.m. on 23 March 2005 pending the issue of this     
    announcement. Trading in the Shares will continue to be suspended         
    pending the issue of an announcement in relation to a notifiable          
    transaction.                                                              
                                                                              
    THE PLACING AGREEMENT DATED 23 March 2005                                 
                                                                              
    1.1   Parties                                                             
                                                                              
    Issuer:   The Company                                                     
                                                                              
    Placing Agent:   Kim Eng Securities (Hong Kong) Limited                   
                                                                              
    The Placing Agent and its ultimate beneficial owners are not Connected    
    Persons of the Company (as defined in the Listing Rules) and are also     
    independent of and not connected with the Company and its Connected       
    Persons. The Placing Agent will charge an underwriting commission of      
    2.0% of the amount equal to the Placing Price multiplied by the number    
    of Placing Shares underwritten under the Placing. Such commission shall   
    be borne by the Company.                                                  
                                                                              
    1.2   The Placing Shares                                                  
                                                                              
    Pursuant to the Placing and Underwriting Agreement, 90,000,000 new        
    Shares, representing approximately 9.62% of the existing issued share     
    capital of the Company and approximately 8.53% of the share capital of    
    the Company as enlarged by the Placing and the Subscription, are to be    
    placed on a fully underwritten basis by the Placing Agent.                
                                                                              
    1.3   The Placing Price                                                   
                                                                              
    The Placing Price represents a discount of approximately 7.14% to the     
    closing price of HK$0.84 per Share as quoted on the Stock Exchange on 22  
     March 2005 (being the last trading day prior to the suspension of        
    trading in the Shares pending the release of this announcement) and a     
    discount of approximately 3.70% to the average closing price of           
    approximately HK$0.81 per Share as quoted on the Stock Exchange for the   
    last 5 trading days up to and including 22 March 2005.